On Friday, The Chief Executive Officer of Mining Capital Coin, Luiz Capuci Jr, was indicted by the Justice Department for allegedly orchestrating a fraud of an investment worth about $62 million.
Mining Capital Coin’s investment platform, also known as MCC, is a crypto mining and investment platform. The CEO, Capuci, who is from Florida, St. Lucie, to be specific, has been accused of selling “Mining packages,” an act termed as misleading, promising good interest from new cryptocurrencies being mined in what is described by the MCC as their International Network of crypto mining machines, as reported by DOJ Press.
In a complaint filed last month by the US Securities and Exchange Commission, not less than 65,000 investors have bought mining packages from Capuci at a time believed not to be later than January 2018.
DOJ alleges that funds were diverted into Capuci’s cryptocurrency wallets instead of the returns. For example, From the sale of the mining packages, MCC made not less than $8.1million and initiation fees made about $3.2million. According to the report by SEC, all of these diverted funds resulted in Capuci’s lavish lifestyle, Lamborghinis, a yacht and real estate.
In the words of Assistant Attorney General Kenneth A. Polite, Jr in the criminal division Department of justice, “Cryptocurrency-based fraud undermines financial markets worldwide as bad actors defraud investors and limit the ability of legitimate entrepreneurs to innovate within this emerging space,”
According to the Press release from DOJ, Capuci also invested in Capital Coin, a Cryptocurrency owned by MCC. The release also alleged “Trading Bot,” another fraudulent avenue of MCC. In his claim, Capuci said Trading Bots give daily returns.
Also, in the allegation, as reported by DOJ, Capuci ran a pyramid scheme, promising promoters that he recruited to sell the mining packages, gift items, Apple watches and even his own personal Ferrari.
Capuci may face up to 45 years in jail if he is found guilty of all accusations against him. Conspiracies to conduct wire fraud, securities fraud, and international money laundering are among the allegations.
Some others have been charged for running fraudulent cryptocurrency schemes this year. For example, in February, the founder of BitConnect was indicted by the Justice Department based on an allegation of orchestrating a $2.4billion global Ponzi scheme.
